UNIVERSITY  OF  ILLINOIS 
LIBRARY 


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Book  Volume 


My  08-1 5M 


Reform  in  Taxation 


FREDERIC  T.  GREENHALGE 
JOSIAH  QUINCY 
JOHN  D.  LONG 

JONATHAN  A.  LANE 
JEROME  JONES 
JOHN  C.  COBB 


WITH 


EDITORIALS  FROM  THE  BOSTON  PAPERS 


MERCHANTS’  MUNICIPAL  COMMITTEE 
OF  BOSTON 


^^<51  l 


TAXATION. 


Governor  Greenhalge,  in  his  inaugural  address, 
Jan.  i,  1896,  said  in  relation  to  taxation: 


0 

C 

P 


Our  laws  of  taxation,  which  have  for  many  years  been  the 
subject  of  constant  discussion,  should  have  careful  consider- 
ation, as  recommended  in  my  first  message.  The  sentiment 
seems  to  be  prevalent  that  our  present  law  is  complicated, 
impracticable,  and  inequitable.  If,  as  experience  seems  to 
have  proved,  it  is  impossible  to  fairly  and  efficiently  collect 
our  taxes  under  the  present  law,  and  if  the  method  of  assess- 
ing under  the  law  is,  as  seems  evident,  so  variable  in  differ- 
ent communities  and  in  the  same  community  at  different 
times  as  to  cause  constant  disturbance  and  an  almost  excus- 
able effort  on  the  part  of  some  of  our  citizens  to  evade  pay- 
ment of  the  full  legal  levy,  it  is  certainly  time  for  a thorough 
investigation  of  the  subject,  with  the  definite  purpose  of  enact- 
ing a clear  and  equitable  law  which  can  be  enforced  in  a fair 
and  just  manner.  I desire  also  to  call  especial  attention  to 
the  fact  that  our  laws  seem  to  bear  oppressively  on  our  busi- 
ness and  industrial  enterprises,  which  should  be  especially 
fostered  and  encouraged,  as  the  source  from  which  most 
of  our  citizens  derive  their  livelihood.  Massachusetts  must 
enter  into  competition  with  other  States ; and  experience 
has  shown  that  there  is  no  force  more  potent  in  bringing 
industrial  development,  with  all  its  attendant  advantages  of 
labor  for  our  people,  business  for  our  merchants,  markets  for 
our  farmers,  and  traffic  for  our  railroads,  than  wise  and  liberal 
laws  of  taxation. 


p 


4 


TAXATION. 


From  address  of  John  C.  Cobb,  on  " Reform  in 
Taxation,”  at  the  Parker  Memorial,  March  5,  1896: 

It  seems  fitting  at  this  time  and  in  this  hall  to  say  a word 
in  relation  to  the  loss  we  have  suffered  in  the  death  of  our 
Governor.  I but  voice  the  universal  sentiment  in  saying 
that  few  men  in  our  history  have  impressed  the  people  of 
the  Commonwealth  more  generally  as  having  clear,  sound 
judgment,  and  we  can  point  to  few  men  who,  even  in  the 
heat  of  a political  contest,  have  excited  less  antagonism,  and 
have  commanded  the  respect  of  all  citizens,  regardless  of 
party,  than  Governor  Greenhalge. 

Personally,  I knew  him  but  slightly,  and,  in  fact,  never 
knew  him  until  this  winter,  when  our  Merchants’  Municipal 
Committee  appointed  me  to  consult  with  him  for  assistance 
in  formulating  our  views  on  this  subject  of  taxation.  My 
last  interview  with  him  was  on  the  last  day  he  was  at  the 
State  House,  when,  with  Hon.  George  G.  Crocker,  an  hour 
was  spent  with  him  in  going  over  the  details  of  the  proposed 
legislation.  I was  especially  struck  with  his  earnest  desire 
for  simplicity  in  the  law,  and  his  wish  to  accomplish  the 
results  with  the  least  possible  disturbance  to  existing  condi- 
tions. We  left  him  with  an  appointment  for  the  following 
Monday,  when  he  was  to  decide  whether  he  would  treat  the 
matter  in  a letter  to  our  committee,  or  later  by  a special 
message  to  the  Legislature.  When  Monday  came,  he  was 
stricken  down,  never  to  rise  again. 

While  it  cannot  be  claimed  that  the  ideas  in  our  pro- 
posed system  are  original  with  him,  yet  as  the  first  authorita- 
tive and  official  promulgation  of  the  principles  adopted  by 
us  came  in  his  inaugural  address,  and  as  this  was  undoubtedly 
the  last  great  question  which  received  his  consideration,  I 
feel  that  it  is  no  more  than  a just  tribute  to  his  memory  to 
let  it  be  known  as  the  “ Greenhalge  Tax  Law,”  and  I am 
sure  Mayor  Quincy  and  the  chairman  of  our  committee, 
Hon.  Jonathan  A.  Lane,  as  the  only  others  who  can  fairly 
claim  a part  in  formulating  the  system,  will  earnestly  join  me 
in  the  suggestion.  To  us  who  undertook  this  great  reform, 
under  his  guidance  and  leadership,  his  loss  comes  as  a severe 
and  almost  crushing  blow. 


ADDRESS  OF  MAYOR  QUINCY. 


5 


Portion  of  the  inaugural  address  of  Mayor  Quincy 
relating  to  taxation,  Jan.  6,  1896  : 

While  our  system  of  taxation  is  fixed  by  State  legislation, 
the  city  of  Boston  should  exert  its  influence  in  every  proper 
way  to  secure  such  amendments  to  the  tax  laws  as  will  bring 
them  more  into  harmony  with  the  needs  of  a large  commer- 
cial centre,  brought  into  daily  competition  with  cities  in 
which  taxation  is  levied  in  a manner  far  less  burdensome  to 
business  enterprise. 

The  Governor  of  the  Commonwealth,  in  his  recent  inau- 
gural address,  has  recognized  the  evils  of  our  present  tax 
system,  and  has  forcibly  pointed  out  its  injurious  influence 
upon  the  industrial  development  of  the  State.  “ Our  laws,”  he 
says,  “ seem  to  bear  oppressively  on  our  business  and  indus- 
trial enterprises,  which  should  be  especially  fostered  and 
encouraged  as  the  source  from  which  most  of  our  citizens 
derive  their  livelihood.”  He  further  points  out  that  “ expe- 
rience has  shown  that  there  is  no  force  more  potent  in 
bringing  industrial  development  than  wise  and  liberal  laws  of 
taxation.”  These  words  have  a very  direct  and  important 
application  to  the  city  of  Boston,  and  in  such  application  I 
desire  to  give  them  my  hearty  endorsement.  The  city  gov- 
ernment of  Boston  and  the  representatives  of  the  city  in  the 
Legislature  can  in  no  way  more  effectively  promote  the 
development  of  the  trade  and  the  manufacturing  and  mechan- 
ical industries  of  Boston  than  by  using  every  endeavor  to 
secure  more  liberal  tax-laws,  and  thereby  enable  our  people 
to  meet  the  competition  of  their  commercial  and  industrial 
rivals  in  other  States.  As  soon  as  the  Merchants’  Municipal 
Committee,  above  referred  to,  is  organized,  I shall  invite  it  to 
take  up  the  subject  of  securing  such  needed  changes  in  our 
tax-laws,  and  I trust  that  the  influence  of  the  Governor  of 
the  Commonwealth,  of  the  Speaker  of  the  House  of  Rep- 
resentatives,— who,  in  reassuming  that  position,  expressed 
views  similar  to  those  of  the  Governor, — of  the  Mayor  of 
the  city  of  Boston,  and  of  the  business  organizations  of  the 


6 


TAXATION. 


city,  supplemented,  as  I trust  may  be  the  case,  by  the  City 
Council,  may  be  effectively  united  upon  some  practical  and 
comprehensive  plan  which  will  secure  general  support. 

While  I shall  be  ready  to  cooperate  in  any  movement 
which  may  tend  to  mitigate  the  evils  caused  by  our  present 
unscientific  and  defective  system,  I desire  to  express  my 
personal  conviction  that  in  order  to  accomplish  any  far- 
reaching  benefits,  false  theories  of  taxation  must  be  abso- 
lutely abandoned.  I believe  that  a large  majority  of  the 
business  men  of  Boston  are  now  ready  to  support  a move- 
ment to  place  upon  real  estate  all  taxes  other  than  those 
levied  upon  the  franchises  of  quasi-public  corporations,  and 
upon  the  estates  of  deceased  persons,  and  that  the  real-estate 
interests  would  support  the  same  policy.  Taxation  levied 
upon  real  estate  distributes  itself  through  the  community  at 
least  as  equitably  as  it  can  be  distributed  under  any  system, 
while  it  has  the  great  advantages  of  perfect  simplicity, 
impossibility  of  evasion,  and  absolute  freedom  for  business 
development. 

The  wage-earners,  who  constitute  such  a large  majority  of 
our  population,  have  every  interest  in  favoring  a system  which 
would  result  in  greatly  stimulating  enterprise,  and  enlarging 
the  field  for  the  profitable  employment  of  labor  in  this  city. 
That  such  a system  of  taxation  is  best  adapted  to  the  wants 
of  a community  such  as  ours  is  not  only  supported  by 
theoretical  reasoning,  but  demonstrated  by  the  practical  ex- 
perience of  such  great  commercial  and  industrial  cities  as  New 
York  and  Philadelphia.  The  importance  of  the  object  is  so 
great  that,  if  the  union  of  the  necessary  forces  can  be  effected, 
even  the  necessity  of  securing  an  amendment  to  the  Constitu- 
tion should  not  be  allowed  to  stand  in  the  way  of  making 
the  effort.  Such  a movement  should  be  based,  not  upon  an 
effort  to  protect  some  of  our  citizens  from  double  taxation, 
but  simply  upon  the  broad  ground  that  a system  of  taxation 
laying  the  burden  only  upon  property  which  cannot  move 
away  will  prove  a benefit  to  all  classes  in  the  community, 
give  an  absolutely  free  field  for  business  expansion,  and,  most 
of  all,  help  those  who  are  dependent  for  their  livelihood  upon 
commercial,  mechanical,  and  other  industrial  development. 


ADDRESS  OF  HON.  JONATHAN  A.  LANE. 


7 


At  a dinner  to  the  mayors  and  the  presidents  of 
the  boards  of  trade  of  the  cities  of  the  Common- 
wealth, on  Feb.  29,  1896,  Hon.  Jona.  A.  Lane, 
Jerome  Jones,  Ex-Governor  Long,  and  John  C. 
Cobb  gave  the  following  addresses: 

Hon.  Jonathan  A.  Lane,  Chairman  of  the 
Merchants’  Municipal  Committee,  said: 

Your  Honors  and  Gentlemen:  It  has  been  my  fortune 
to  face  a good  many  bodies  of  public  men,  during  the  last  ten 
years  of  my  life,  by  virtue  of  my  position  as  President  of  the 
Boston  Merchant  Association,  but  I do  not  know  that  I ever 
faced  a body  of  men  with  a deeper  sense  of  the  responsibility 
which  attached  to  the  hour  than  I do  on  this  occasion,  both 
by  virtue  of  the  importance  of  the  subject  to  be  discussed  and 
the  character  of  the  gentlemen  whom  I address.  The  real- 
estate  valuation  of  this  Commonwealth,  as  you  know,  is  the 
round  sum  of  $2,000,000,000.  Of  that  amount,  His  Honor 
Mayor  Quincy  represents  $800,000,000,  and  you  other 
gentlemen,  mayors  of  the  thirty  other  cities  of  the  Common- 
wealth, represent  as  much  more;  so  that  we  have  with  us  to- 
day representatives  of  $1,600,000,000  of  real  estate,  out  of  the 
total  $2,000,000,000  of  real  estate  in  this  Commonwealth. 
This  gathering,  therefore,  virtually  represents  Massachusetts 
on  this  occasion,  for  Massachusetts  is  a State  of  cities  ; and  not 
only  do  the  cities  represent  the  great  bulk  of  the  property, 
both  personal  and  real,  but  they  represent  the  industries  and 
the  trade  of  the  Commonwealth. 

The  condition  of  things  at  the  present  time  is  not  what  it 
was  when  Massachusetts  was,  to  a considerable  extent,  an 
agricultural  State  ; and  any  system  of  taxation,  it  seems  to  me, 
which  is  worthy  of  our  consideration  should  be  one  adapted 
to  this  changed  condition  of  things.  I suppose  the  agricult- 
ural interests  of  the  Commonwealth  may  be  said  to  represent 


8 


TAXATION. 


one-tenth  of  the  valuation  of  the  property  of  the  Common- 
wealth, or  hardly  that. 

We  do  not  propose,  however,  to  inflict  any  injury  upon 
that  important  interest.  The  scheme  of  taxation  which  we 
propose  is  one  which  will  do  as  much  for  the  agricultural 
people  as  for  any  other  body  of  citizens.  I am  glad  that  this 
is  so,  for  I have  no  doubt  that  most  of  you  are  the  sons  of 
farmers,  and  that  you  would  not  like  to  see  any  new  system 
of  taxation  adopted  which  would  be  a hardship  to  them. 
None  of  us  would  like  to  see  that. 

I desire  to  say,  also,  that  we  do  not  come  here  with  any 
purpose  to  force  upon  you  any  scheme  of  our  own.  We 
have  views  on  this  subject  which  we  believe  to  be  sound,  and 
which  are  in  accordance  with  the  best  thought  of  our  times, 
and  about  which  we  wish  to  confer  with  you  ; but  we  do  not 
wish  to  force  it  upon  you.  We  come  here,  all  of  us,  to 
confer  upon  this  subject.  If  you  should  agree  with  us  upon 
the  principles  embodied  in  our  bill,  the  details  can  be  very 
easily  arranged.  We  desire  to  have  the  sympathy  and 
cooperation  of  the  cities  of  the  Commonwealth,  for  without 
that  we  can  do  nothing. 

It  seems  that  there  can  be  nothing  in  the  world  conceived 
of  wiser  than  to  relieve  the  local  assessors  from  the  necessity 
of  making  efforts  to  find  out  the  unsearchable  and  unknow- 
able in  the  matter  of  personal  property.  We  believe,  more- 
over, that  the  majority  of  the  assessors  will,  when  they  really 
understand  our  plan,  be  enthusiastic  at  being  relieved  of  a 
duty  which  no  man,  it  seems  to  me,  could  take  any  satisfac- 
tion in  attempting  to  perform. 

The  next  important  feature  — and  this  is  one  which  you 
may  wish  to  consider  more  carefully  — is  that  by  which  we 
propose  to  make  good  the  deficit  or  the  difference  which  will 
result.  We  propose  to  make  up  for  it  partly  by  taxing  cer- 
tain corporations,  practically  as  we  tax  them  to-day;  but  the 
main  source  of  revenue  from  this  bill  is  expected  to  come 
from  the  Probate  Court  by  means  of  an  inheritance  or  sue- 


ADDRESS  OF  HON.  JONATHAN  A.  LANE. 


9 


cession  tax.  This  may  strike  you  as  a novelty,  and  some- 
thing which  will  not  yield  such  a return  as  you  think  will  be 
necessary  to  make  up  the  difference.  We  wish  you  to  realize 
that  the  wealth  of  this  State  is  flowing  through  that  channel 
constantly  and  unceasingly,  and  that  the  entire  wealth  of  the 
State  reaches  that  point  ultimately,  and  when  it  does  there 
is  no  shrinkage.  The  government  of  Great  Britain  gets 
eleven  million  pounds  sterling  from  that  source  — one-eighth 
part  of  its  entire  budget.  It  is  a great  problem  as  to  what  is 
the  real  wealth  of  Massachusetts.  According  to  the  returns 
of  the  assessors  and  the  records  at  the  State  House,  it  would 
be  about  $3,500,000,000.  How  much  more  there  is,  nobody 
can  tell ; but  there  is  undoubtedly  far  beyond  that  amount,  for 
we  all  know  that  there  is  a vast  amount  of  property  owned 
by  the  people  of  Massachusetts  situated  in  other  States,  and 
which  does  not  pay  any  tax  here,  but  pays  one  where  it  is 
situated.  In  addition  to  the  property  which  is  situated  here, 
all  that  property  will  finally  be  probated  in  the  courts  of  the 
Commonwealth,  and  from  that  source  a revenue  will  come 
which  will  surprise  you.  We  have  calculated  that  the  amount 
which  will  be  realized  by  the  city  from  this  method  of  taxing 
personal  property  will — not  perhaps  the  first  year,  but  cer- 
tainly the  second  — be  equal  to  the  entire  State  and  county 
tax ; and  I think  you  will  find,  gentlemen,  that  when  the 
cities  and  towns  are  relieved  of  these  two  taxes,  the  addition 
to  the  tax  on  real  estate  will  be  comparatively  trifling. 

At  any  rate,  this  movement  on  behalf  of  this  system  of 
taxation  I have  indicated  proceeds  from  the  real-estate  inter- 
ests of  the  State.  The  real-estate  men  feel,  and  they  feel  it 
very  strongly,  that  if  you  will  contrive  a system  of  taxation 
by  which  money  will  flow  into  this  State  and  be  invested  in 
business,  in  mercantile  interests,  and  in  manufacturing  inter- 
ests,— as  we  believe  would  be  the  case  if  we  agreed  that  it 
should  not  be  taxed  until  the  persons  who  own  it  get  through 
with  it,  — it  will  greatly  promote  the  prosperity  of  the  State 


IO 


TAXATION. 


and  increase  the  value  of  the  real  estate ; and  I believe  they 
are  right  in  that  theory.  Real  estate  has  no  value  except  by 
reason  of  its  relation  to  personal  property.  That  is  the  prin- 
ciple which  I wish  to  strongly  impress  upon  you  — that  the 
prosperity  of  Massachusetts  can  be  promoted  more  by  bring- 
ing personal  property  into  the  State  in  the  manner  in  which 
we  propose  than  in  any  other  way.  Our  scheme  is,  there- 
fore, to  relieve  from  taxation,  just  as  they  do  in  Pennsylvania 
the  capital  which  men  employ  in  their  business.  We  believe 
that  is  sound  policy  for  Massachusetts,  just  as  much  as  it  is 
for  other  States.  We  believe  that  if  Massachusetts  is  to  hold 
her  own  in  competition  with  the  other  great  States  of  the 
Union,  she  must  look  out  for  herself;  and  inasmuch  as  that 
is  the  case  we  must  look  the  matter  squarely  in  the  face,  and 
see  what  policy  we  can  adopt  which  would  bring  about  the 
best  results  in  that  line. 

Now,  gentlemen,  I have  outlined  the  principles  of  our  bill. 
As  I said  in  the  beginning, we  are  not  particular  as  to  details; 
all  we  care  for  is  to  have  you  agree  to  the  general  principles. 
The  present  system  is  unsatisfactory  to  every  one.  It  is  a 
humbug  and  a fraud,  and  it  is  time  that  we  devised  a better 
system.  We  need  to  carry  into  our  system  of  taxation  the 
principles  of  simplicity,  honesty,  and  common  sense;  and  we 
can  do  it.  We  can  do  it  by  a long  pull,  a strong  pull,  and  a 
pull  all  together. 

Let  me  say  right  here  that  the  people  of  other  States  are 
looking  on,  and  watching  this  movement  in  Massachusetts 
with  a great  deal  of  interest.  We  are  constantly  in  receipt 
of  information  which  shows  that  to  be  the  case.  Somehow 
the  people  have  found  out  that  there  is  a progressive  move- 
ment on  foot  here.  It  is  challenging  the  attention  of  all,  and 
many  people  are  intensely  interested  in  it. 

I believe  that  the  times  are  favorable  for  this  change.  His 
Excellency  the  Governor  of  this  Commonwealth  has  used 
language  upon  this  subject,  in  his  inaugural  address,  which  I 


ADDRESS  OF  HON.  JONATHAN  A.  LANE.  I I 

desire  to  repeat.  The  people  of  Massachusetts  have  always 
entertained  a profound  respect  for  the  opinions  of  their  gov- 
ernors. They  have  a great  deal  of  respect  for  their  views* 
not  only  as  men  who  have  the  interest  of  the  State  at  heart, 
but  they  have  an  affectionate  regard  for  them  personally  as 
well.  Living  or  dead,  we  honor  the  governors  of  the  Com- 
monwealth. The  fact  that  we  have  an  ex-governor  with  us 
to-night  makes  me  apologize  for  my  remarks  to  a certain 
extent,  but  I do  not  feel  like  apologizing  very  much. 
(Applause.) 

In  his  last  inaugural,  Governor  Greenhalge  said  : 

“I  desire  also  to  call  especial  attention  to  the  fact  that  our 
laws  seem  to  bear  oppressively  on  our  business  and  industrial 
enterprises,  which  should  be  especially  fostered  and  encour- 
aged, as  the  source  from  which  most  of  our  citizens  derive 
their  livelihood.  Massachusetts  must  enter  into  competition 
with  other  States,  and  experience  has  shown  that  there  is  no 
force  more  potent  in  bringing  industrial  development,  with 
all  its  attendant  advantages  of  labor  for  our  people,  business 
for  our  merchants,  markets  for  our  farmers,  and  traffic  for 
our  railroads,  than  wise  and  liberal  laws  of  taxation.” 

That  is  what  we  are  undertaking  to  do.  We  are  proceed- 
ing in  this  movement  in  accordance  with  the  recommen- 
dations of  His  Excellency  the  Governor.  We  are  also 
supported  by  earnest  and  hearty  recommendations  in  the 
same  line  by  His  Honor  Mayor  Quincy.  There  is  no  poli- 
tics in  this  movement  whatever  — not  the  slightest.  We  are 
in  it  for  the  good  of  the  old  Commonwealth,  and  nothing 
else.  (Applause.)  We  know  that  we  shall  have  to  encoun- 
ter a great  deal  of  prejudice  and  a good  deal  of  suspicion ; 
but  we  all  believe  it  to  be  right.  We  propose  to  give  you 
something  better  than  you  have,  something  which  will  do 
more  for  Massachusetts  than  any  man  here  can  conceive 
of,  and  certainly  more  than  any  poor  words  of  mine  can 
express.  (Applause.) 


12 


TAXATION. 


Mr.  Jerome  Jones  said: 

Mr.  Mayor  and  Gentlemen:  I am  glad  to  see  a meet- 
ing of  this  sort,  as  I believe  it  tends  to  better  government. 
I believe  that  it  is  wise  for  the  representatives  of  the  trade 
and  industrial  interests  of  the  State  to  meet  and  compare 
ideas,  and  to  discuss  reforms  that  can  be  and  should  be  dis- 
cussed. I do  not  mean  by  that  to  infer  that  we  are  not  well 
governed  under  the  present  condition  of  affairs  in  Massachu- 
setts. I think  that  Massachusetts  is  the  foremost  State  in 
respect  to  good  government.  It  has  been  customary  for  her 
to  take  up  great  problems,  and  to  discuss  and  solve  them  for 
the  benefit  of  all. 

At  the  present  time  we  find  our  mercantile,  commercial,  and 
industrial  enterprises  heavily  taxed  in  comparison  with  other 
States,  and  to  such  an  extent  that  it  has  reached  the  friction 
point.  This  is  wrong;  because  in  conducting  our  business 
we  encounter  competition  from  other  localities  and  commu- 
nities that  have  an  advantage  over  us.  It  may  be  claimed 
that  the  theory  of  the  present  law  is  a good  one,  — and  I do 
not  say  but  what  the  theory  is  fair,  — but  theories  and  prac- 
tice are  two  quite  different  things.  You  charge  the  assessor 
of  a town  with  the  duty  of  assessing  the  real  and  personal 
property  of  his  town,  and  require  him  to  do  his  work  under 
oath.  It  may  be  proper  in  theory  that  real  and  personal 
property  should  both  bear  the  burden  of  taxation,  but,  with 
human  nature  constituted  as  it  is,  the  assessor  is  not  able  to 
perform  that  duty  which  you  have  assigned  him  properly, 
for,  on  account  of  the  nature  of  personal  property,  on  ac- 
count of  its  being  so  portable,  so  fugitive,  and  so  capable  of 
evasion,  experience  has  proven  that  he  will  not  get  one- 
quarter  of  the  personal  property  of  his  town  assessed.  Now, 
if  that  is  so,  — and  I challenge  any  man  to  disprove  it,  — the 
theory  may  be  good,  but  when  reduced  to  practice  it  is  bad. 
Such  being  the  case,  if  we  cannot  have  it  as  we  would,  let  us 
have  it  the  very  best  we  can. 

We  believe  that  the  reform  in  taxation  suggested  by  the 


ADDRESS  OF  MR.  JEROME  JONES. 


13 


Governor  and  the  Mayor,  while  it  would  place  the  local  bur- 
den on  real  estate,  would  result  in  making  the  State  attractive 
to  business  enterprises  to  an  extent  which  would  make  real 
estate  more  in  demand  and  more  useful,  and  in  producing 
greater  prosperity  for  the  wage-earner  and  the  manufacturer, 
because  of  the  improved  conditions.  Some  one  will  say  that 
the  slight  difference  recommended  by  us  would  not  produce 
such  a result  as  this ; but  it  does.  If  you  investigate  the 
matter,  you  will  find  that  in  New  York,  in  Philadelphia,  in 
Chicago,  and  in  many  other  cities,  thousands  of  industries,  I 
might  say,  have  been  attracted  there  because  in  those  places 
they  are  not  taxed  to  any  extent  on  the  raw  material,  the  fin- 
ished product,  and  the  movable  plant.  Here,  he  knows  that 
he  must  pay  taxes  on  them  unless  he  makes  a false  oath,  or 
is  able  to  hoodwink  the  assessors.  Instead  of  this  unsatis- 
factory method,  we  propose  that  personal  property  shall  be 
taxed  only  for  State  purposes  as  named  in  the  bill,  and  that 
it  shall  be  taxed  by  a method  which  cannot  be  made  evasive, 
thereby  enabling  us  to  relieve  from  taxation  those  enterprises 
which  may  desire  to  locate  here. 

I remember  that  James  M.  Beebe  once  said  that  there  was 
but  one  per  cent,  of  difference  between  success  and  failure. 
When  I first  heard  that,  I thought  that  it  didn’t  signify  any- 
thing, but  it  really  does  mean  much;  and  the  taxon  merchan- 
dise, the  tax  on  the  raw  material  and  on  the  finished  product, 
in  short,  the  personal-property  tax,  constitutes  that  difference. 
This  was  fairly  demonstrated  in  the  non-taxing  of  mortgages. 
Contrary  to  the  contention  of  those  who  opposed  the  removal 
of  the  tax  from  mortgages,  it  resulted  in  the  rate  of  interest 
being  dropped  about  one  per  cent. ; and  the  borrower  gets 
the  benefit,  and  the  full  benefit.  If  that  law  had  gone  into 
effect  ten  or  twenty  years  earlier,  it  would  have  kept  millions 
of  Massachusetts  capital  at  home,  instead  of  its  being  invested 
in  Atchison  and  other  far-off  enterprises,  which  brought 
ruin  to  the  investors  who  were  tempted  to  evade  local 
taxation. 


14 


TAXATION. 


I believe  that  the  State  of  Massachusetts  is  well  adapted  to 
manufacturing  enterprises.  We  have  an  admirable  system  of 
transportation  by  railroads,  by  which  we  are  enabled  to  take 
our  freight  and  ship  it  from  tide-water  to  the  great  West  as 
cheaply  as  can  be  done  from  New  York.  We  have  also  an 
effective  system  of  steamship  lines.  I do  not  know  that  it  is 
generally  known  that  the  amount  of  Liverpool  freight  com- 
ing to  this  port  is  as  large  as  that  which  goes  from  Liverpool 
to  New  York.  We  have  favorable  transportation  facilities, 
both  by  sea  and  by  land,  we  have  a good  climate,  and  we 
have  a good  State  government.  We  have  all  these  facilities 
which  are  required  to  make  a community  healthy,  wealthy, 
and  prosperous,  but  our  unequal  and  burdensome  laws  of 
taxation  constitute  the  “ one  per  cent,  of  difference  between 
success  and  failure”  spoken  of  by  Mr.  Beebe.  Under  our 
unequal  and  unjust  tax-laws,  the  assessor  is  compelled  to 
punish  a business  enterprise  which  seeks  to  invest  and  locate 
in  Massachusetts. 

I have  no  doubt  that  this  reform  will  be  attacked  at  the 
State  House  as  severely  as  the  Australian  ballot-law  was. 
When  that  was  first  proposed,  countless  objections  were  raised 
against  it.  They  said  that  it  was  an  invasion  of  our  rights, 
and  that  they  could  not  think  of  giving  up  our  old  system  of 
peddling  out  votes  at  the  town-house;  but  when  they  came 
to  understand  it  thoroughly,  it  was  adopted  quickly,  and  we 
wouldn’t  give  it  up  now.  I believe,  gentlemen,  that  the  more 
you  study  this  question  of  taxation,  the  more  you  will  be  con- 
vinced of  the  simplicity,  the  practicability,  and  the  fairness  of 
it.  Personal  property  is  so  fugitive,  so  portable,  and  the  tax 
on  it  is  so  easily  evaded,  that  we  are  compelled  to  legislate 
according  to  the  nature  of  things.  Put  your  tax  upon  real 
estate,  upon  quasi-public  corporations,  and  upon  successions 
and  inheritances,  — the  last  two  going  into  the  State  treasury, 
— and  thus  leave  personal  property  free  to  engage  in  enter- 
prises here  on  as  favorable  terms  as  in  any  other  part  of  the 
nation,  and  I do  not  think  any  man  will  say  that  we  are  going 
to  regret  it.  (Applause.) 


ADDRESS  OF  HON.  JOHN  D.  LONG. 


15 


Hon.  John  D.  Long,  the  next  speaker,  said  : 

I do  not  care  to  indulge  in  compliments,  but  I rejoice  that 
our  Mayor  is  taking  a forward  step  in  all  these  matters.  I 
do  not  know  why  I was  invited  to  be  here  or  to  speak,  be- 
cause I am  not  an  expert  on  the  subject  of  taxation.  I had 
intended  to  sit  at  the  feet  of  some  of  these  other  gentlemen 
and  gather  information  from  them.  We  want  them  to  give 
us  information  that  we  can  carry  back  to  our  country  dis- 
tricts and  distribute.  We  want  you  to  furnish  us  with 
answers  to  questions  which  will  be  put  to  us  by  hard-headed, 
intelligent,  sensible  men,  who  will  raise  very  grave  questions 
with  regard  to  your  new  plan. 

It  seems  to  me  that  in  starting  on  this  new  project  we 
should  not  indulge  in  generalities,  but  get  right  down  to  the 
root  of  the  matter,  and  understand  the  elementary  things  con- 
nected with  it.  I notice  that  all  these  great  reforms  finally 
come  down  to  one  or  two  elementary  principles.  The 
danger,  it  seems  to  me,  is  that  people  will  get  the  idea  that 
this  is  a contest  between  personal  property,  on  the  one  hand, 
and  real  estate,  on  the  other;  that  it  is  an  attempt  of  rich 
men,  who  have  notes,  mortgages,  bonds,  stocks,  and  securities, 
to  get  rid  of  a tax,  and  to  have  it  put  on  the  farmer  and  the 
holder  of  real  estate,  who  cannot  conceal  his  property.  Let 
us  understand,  therefore,  in  the  first  place,  that  there  is  no 
contest  of  that  kind,  and  that  there  is  no  desire  on  the  part 
of  anybody  to  select  real  estate  to  be  taxed  or  personal 
estate  to  be  relieved  from  taxation,  on  the  ground  that  one 
is  to  be  favored  and  the  other  not. 

I am  heartily  in  favor  of  this  scheme,  but  when  I say  that, 
I want  it  to  be  distinctly  understood  that  if  you  could  carry 
out  a scheme  of  a fair,  simple,  straightforward  tax  by  plac- 
ing it  on  personal  estate  instead  of  placing  it  on  real  estate,  I 
would  just  as  soon  have  you  do  it  as  to  place  it  on  real 
estate.  There  is  no  magic  in  either  name. 

But  why  do  we  not  advocate  putting  it  on  personal  prop- 
erty? Simply  because  it  has  been  the  experience  of  every 


1 6 


TAXATION. 


man  who  has  had  anything  to  do  with  the  matter,  that  you 
cannot  put  the  tax  on  personal  property.  We  have  been 
trying  to  tax  it  for  years  and  years,  under  the  most  thorough 
and  complete  system  that  could  be  devised,  and  we  have 
failed.  We  cannot  do  it.  Why?  Because  personal  prop- 
erty is  of  such  a nature  that  it  eludes  taxation.  The  theory 
may  be  right,  but  you  must  take  into  consideration  human 
nature  as  much  as  anything  else,  and  with  human  nature  as 
it  is,  a large  part  of  the  personal  property  of  the  State  does 
escape  taxation,  and  always  will  escape  taxation.  It  does 
not  all  escape,  but  some  of  it  does  — and  there  is  where  the 
injustice  comes  in.  If  it  all  did,  it  would  make  no  difference. 
The  wrong,  injustice,  tyranny,  and  falsehood  of  the  present 
system  consist  in  the  fact  that  a large  part  of  it  escapes 
while  the  rest  does  not.  You  thereby  violate  the  spirit  of 
our  tax-laws,  which  is  that  taxation  should  be  uniform  and 
fair. 

The  first  trouble  in  taxing  personal  property  is  that  you 
cannot  tell  what  it  is.  Suppose  I paid  $2  for  a ticket  to  this 
dinner.  If  I had  done  so,  and  had  decided  not  to  come, 
suppose  I had  sought  out  some  belated  mayor,  and  sold  him 
that  ticket  for  $1.50.  Now,  in  that  case,  what  would  I have 
sold  him,  the  ticket  or  the  dinner?  If  I sold  him  the  ticket, 
it  was  worth  $1.50,  and  the  dinner  was  worth  nothing. 
(Laughter.)  You  laugh,  for  that  is  ridiculous;  but  that  is 
all  there  is  to  a certain  class  of  personal  property  — stocks, 
certificates,  etc.  You  are  first,  therefore,  met  with  the  diffi- 
culty of  telling  what  personal  estate  is.  But  the  fundamental 
difficulty  is  that  it  is  elusive.  In  imposing  taxes,  we  should 
place  the  tax  on  something  which  is  tangible  — which  is  not 
elusive  — something  on  which  it  can  be  uniformly  and  fairly 
assessed  and  uniformly  and  fairly  collected. 

That  is  why  we  say  that  we  better  put  the  tax  on  real  estate. 
Real  estate  is  plainly  visible ; a tax  can  be  imposed  upon  it 
with  absolute  uniformity,  and  when  you  impose  a tax  on  it, 
no  man  can  escape.  It  will  be  fairly  assessed,  and  it  will  be 
fairly  and  uniformly  collected.  We  put  it  there  as  a matter 


ADDRESS  OF  HON.  JOHN  D.  LONG. 


17 


of  principle.  We  put  it  there  in  the  interest  of  honesty. 
We  put  it  there  because  by  so  doing  you  get  the  two 
elements  which  make  a tax  system  perfect,  and  those  are  the 
elements  of  absolute  honesty  and  absolute  simplicity.  If  we 
were  to  land  upon  some  island,  were  to  start  a new  govern- 
ment, were  to  institute  a system  of  taxation  there,  there  is 
no  question  that  we  should  adopt  this  system.  Let  us  adopt 
it  now.  You  can  do  it  just  as  easily  as  you  did  the  Australian 
ballot. 

Let  us  take  some  of  the  objections  which  will  be  urged : 

It  will  be  said  that  this  will  suddenly  shift  a large  part  of 
the  tax  upon  real  estate.  The  answer  to  that  is  that  it  will 
not  do  so.  It  will  add  something,  but  not  much ; and  the 
figures  in  regard  to  the  exact  amounts  we  shall  probably  get 
from  Mr.  Cobb  and  the  other  speakers.  In  the  town  of 
Hingham,  for  instance,  our  tax  is  now  $16.  Of  the  taxes 
assessed,  possibly  one-quarter  is  assessed  upon  personal 
property.  Removing  the  tax  on  that  property  and  eliminat- 
ing the  State  and  county  tax,  which  would  be  taken  care  of 
by  the  other  bills  which  the  committee  has  recommended,  we 
find  that  our  tax  on  real  estate  would  be  increased  about 
$2.50  per  thousand.  But  what  of  that,  if  our  personal  prop- 
erty would  be  relieved  from  taxation  to  a substantially  equal 
extent. 

But  the  farmer  may  say : “ My  property  is  mainly  in  real 
estate,  and  it  will  work  a hardship  upon  me  by  increasing 
the  tax  on  that.”  The  answer  to  him  is  this : To  be  sure, 
the  tax  upon  his  real  estate  will  be  enlarged  somewhat,  but  he 
will  be  relieved  from  the  tax  upon  his  hay,  upon  his  wagons, 
upon  his  stock,  upon  his  tools,  and  upon  all  articles  of  per- 
sonal property ; and  the  practical  result  will  be  that  the  bur- 
den will  be  shifted  — not  increased  to  any  considerable  extent. 

Then  the  owner  of  real  estate  on  the  seashore  may  say 
that  real  estate  is  valuable  for  summer  residences  alone,  and 
that  increased  tax  on  it  will  be  a hardship  upon  him  : “ I have 
two  or  three  houses,  which  I let  to  summer  people.  The 


1 8 


TAXATION. 


real-estate  tax  will  be  larger,  and  consequently  the  tax  on 
each  of  those  cottages  will  be  larger;  so  that  I will  lose  just 
so  much.”  But  he  won’t.  On  the  other  hand,  it  will  not  add 
one  penny  to  his  expense.  Why?  Simply  because  he  will 
charge  his  Boston  friend,  who  comes  down  and  hires  his 
cottage,  enough  more  to  cover  the  increased  tax.  “ Yes,  but 
doesn’t  that  shift  the  burden  upon  the  Boston  friend,  and  will 
he  be  willing  to  pay  it?”  Certainly!  Why?  Because  all 
these  Boston  merchants  will  be  relieved  of  the  tax  upon  per- 
sonal property,  their  business  will  be  improved,  and  they  can 
pay  more  rent.  In  the  meantime,  the  fact  that  personal  prop- 
erty is  relieved  from  taxation  will  bring  more  manufacturing 
and  commercial  men  into  this  vicinity,  and  increase  the  num- 
ber of  manufacturing  enterprises  in  the  State,  and  I shall  not 
only  be  able  to  rent  my  cottages,  but  there  will  be  more  of  a 
demand  for  them,  owing  to  the  increased  number  of  people 
who  want  to  hire  them. 

But  the  farmer,  distant  from  the  shore,  may  say : “ I admit 
that  this  doesn’t  trouble  you,  because  the  merchants  of 
Boston  will  be  relieved  from  taxation  on  their  personal  prop- 
erty, and  they  will  be  willing  to  pay  you  more  rent ; but  it 
doesn’t  help  me.  The  fact  that  all  the  taxes  are  placed  on 
my  little  farm,  where  no  summer  residents  ever  come,  only 
increases  the  burden  of  taxation  on  my  real  estate,  subject- 
ing it  to  a larger  assessment  while  it  really  depreciates  its 
value.”  What  is  my  answer  to  him.  That  the  assessors  of 
his  town  have  common  sense,  and  that  if  the  shifting  of  this 
tax  has  had  the  effect  of  increasing  the  value  of  real  estate 
on  the  seashore,  the  assessors  will  take  note  of  that  fact,  and 
put  the  increase  of  the  tax  on  the  real  estate  which  has 
increased  in  value.  In  other  words,  gentlemen,  if  you  will 
follow  this  matter  out  you  will  find  that  this  change  not  only 
adds  very  little,  even  if  things  remain  as  they  are,  to  the 
taxes  on  real  estate,  but  that  whatever  it  does  add  is  counter- 
balanced by  some  set-  off.  In  other  words,  if  you  get  the 
first  principle  of  taxation,  which  is  to  secure  fairness  and 


ADDRESS  OF  HON.  JOHN  D.  LONG. 


19 


simplicity,  and  put  your  taxes  where  they  will  be  equally 
distributed,  the  result  will  take  care  of  itself. 

Now,  gentlemen,  what  will  be  the  result?  The  result  of 
such  a change  will  be  that  a man  can  come  here,  and,  instead 
of  hiding  and  evading  taxation,  put  his  personal  property 
out,  build  his  large  manufacturing  establishments,  and  dis- 
play his  wares  without  being  afraid  that  some  assessor  will 
find  out  that  he  has  them.  (Laughter.)  And,  as  a result, 
you  will  find  that  trade,  commerce,  and  manufactures  will  be 
irresistibly  attracted  here.  I do  not  mean  to  overstate  this 
matter,  but,  as  Mr.  Jones  has  well  said,  such  matters  are  deter- 
mined by  the  fraction  of  one  per  cent,  of  advantage  which 
one  place  offers  over  another.  The  great  bulk  of  capital 
is  exactly  like  water  confined  in  a reservoir  — it  seeks  every 
outlet,  and  wherever  it  can  find  an  opportunity  a little  more 
advantageous  than  anywhere  else,  it  will  irresistibly  drift 
toward  it.  And  the  minute  that  you  increase  the  manufact- 
uring and  trade  enterprises  of  the  community,  you  benefit 
not  merely  investors,  but  the  whole  community,  for  the 
advantages  derived  therefrom  flow  back  upon  the  whole  com- 
munity. As  has  been  said,  the  minute  that  you  pile  up  per- 
sonal property  on  State  street,  you  increase  the  value  of  real 
estate. 

But  I hate  to  dwell  upon  this  feature  of  the  case, — the 
advantage  and  profit  to  be  derived  from  a change  in  the 
system,  — because  I feel  so  deeply  the  principle  involved.  I 
feel  the  shame  thrown  upon  us  all  by  our  present  tax-laws, 
and  the  evasion  of  them  in  which  all  join.  Shame  upon  us 
all ! I believe  it  is  a fact  that  while  the  real  estate  in  Boston 
on  which  taxes  have  been  levied  has  been  doubled,  and 
trebled,  and  quadrupled,  there  has  been  but  a small  percent- 
age of  increase  in  the  amount  of  personal  property  taxed. 
On  the  other  hand,  we  know  that  it  has  actually  increased 
more  than  real  estate,  and  that  simply  means  that  the  tax 
has  been  evaded.  Some  one  told  me  that  in  Somerville  the 
personal-property  tax  is  less  than  it  was  fifteen  or  twenty 


20 


TAXATION. 


years  ago ; yet  there  is  a great  deal  more  there.  We  all 
know  that  there  is  a shameful  hiding  of  personal  property. 
Therefore,  I say,  let  us  adopt  this  new  method  : first,  because 
it  is  right;  second,  because  it  will  be  productive  of  good 
results;  and  third,  because  it  will  not  injure  the  hair  of  a 
single  man’s  head.  There  may  be  a little  difficulty  at  first, 
but  we  can  adapt  ourselves  to  it  very  easily. 

I approve  of  the  bill  presented  by  the  committee,  because 
I do  not  wish  to  see  property  escape  taxation,  but  only  to 
have  it  taxed  fairly.  Let  us  have  a succession  tax  — not  on 
small  estates,  but  upon  estates  of  a reasonable  size.  Where 
a man  who  has  lived  in  this  community,  who  has  been  pro- 
tected by  it,  and  who  has  gained  a fortune  of  $150,000  or  a 
million,  dies,  let  us  set  aside  a proper  sum  to  pay  for  the 
opportunities  under  which  he  has  acquired  it,  and  for  the 
advantages  which  he  and  his  family  have  enjoyed.  When 
a man  dies,  his  property  goes  into  the  Probate  Court.  There 
will  be  no  evasion  there.  You  will  get  it  all. 

. I believe,  also,  in  the  taxation  of  quasi-public  corpora- 
tions. Such  taxation  is  not  really  taxation  at  all,  but  is 
simply  a payment  for  a franchise.  Great  corporations  which 
are  given  the  use  of  our  public  streets  and  the  right  of  emi- 
nent domain  should  pay  for  the  advantages  which  they 
receive.  I am  told  that  those  two  sources,  the  succession 
tax  and  the  quasi-public  corporation  tax,  will  meet  the  entire 
expenditures  of  the  State  and  county.  This  will  enable  the 
different  cities  and  towns  to  meet  their  local  expenditures  by 
a local  tax  upon  their  real  estate  alone.  I believe  that  the 
advantages  that  come  from  having  a simple  and  honest 
system  will  more  than  counterbalance  any  disadvantages 
which  it  may  possess.  (Applause.) 


ADDRESS  OF  MR.  JOHN  C.  COBB. 


21 


John  C.  Cobb,  Vice-Chairman  of  the  Merchants’ 
Municipal  Committee,  was  the  next  speaker.  He 
said : 

Mr.  Mayor  and  Gentlemen:  When  the  Merchants’ 
Municipal  Committee  took  this  matter  up,  we  had  been 
appointed  from  various  organizations,  representing  entirely 
different  occupations;  and  came  together,  many  of  us  total 
strangers  to  each  other  — I,  personally,  came  from  the  Real 
Estate  Exchange.  I have  practically  no  property  except 
real  estate,  which  is  situated  in  different  cities,  some  inside  of 
this  State,  and  some  outside  of  it,  and  I have  therefore, 
perhaps,  had  an  unusual  opportunity  to  judge  of  the  workings 
of  the  tax  laws  in  different  places.  As  the  representative 
of  the  Real  Estate  Exchange  on  the  Merchants’  Municipal 
Committee,  I sought  the  views  of  the  large  real-estate  owners 
in  Boston  upon  this  subject,  and  of  the  Real  Estate  Exchange 
in  general,  and  it  probably  will  strike  you  with  surprise  when 
I tell  you  that,  as  a result  of  the  opinions  which  I heard 
expressed  by  them,  the  representatives  of  the  merchants  and 
manufacturers  upon  the  committee  were  a great  deal  more 
timid  about  the  burden  which  would  be  placed  on  real  estate 
than  I was.  And  the  system  which  we  have  agreed  upon 
does  not  go  to  the  extent  which  I,  personally,  and,  I think  I 
may  say,  a majority  of  the  real-estate  owners  in  Boston  are 
willing  that  it  should  go. 

The  Governor  of  our  Commonwealth,  in  the  part  of  his 
inaugural  address  relating  to  taxation,  has  shown  a wonderful 
grasp  of  this  subject,  and  I want  to  quote  a little  more  fully 
from  it  than  Mr.  Lane  has  done.  He  opens  up  the  subject 
by  saying: 

“ Our  laws  of  taxation,  which  have  for  many  years  been 
the  subject  of  constant  discussion,  should  have  careful  con- 
sideration as  recommended  in  my  first  message.” 

We  have  considered  the  subject,  and  I think  we  are  of  the 
unanimous  opinion  that  it  has  had  “ constant  discussion  ” for 


22 


TAXATION. 


a good  many  years,  that  it  has  been  discussed  just  about  long 
enough,  and  that  it  is  time  that  something  should  be  done 
about  it.  He  says  : 

“ The  sentiment  seems  to  be  prevalent  that  our  present 
law  is  complicated,  impracticable,  and  inequitable.  . . . ” 

On  that  point,  I think  I can  safely  say  that  the  other  mem- 
bers of  the  committee,  as  well  as  myself,  have  yet  to  find  the 
first  man  who  says  that  is  not  so. 

"...  If,  as  experience  seems  to  have  proved,  it  is 
impossible  fairly  and  efficiently  to  collect  our  taxes  under  the 
present  law,  and  if  the  method  of  assessing  under  the  law  is,  as 
seems  evident,  so  variable  in  different  communities  and  in  the 
same  community  at  different  times  as  to  cause  constant  disturb- 
ance and  an  almost  excusable  effort  on  the  part  of  some  of  our 
citizens  to  evade  payment  of  the  full  legal  levy,  it  is  certainly 
time  for  a thorough  investigation  of  the  subject,  with  the 
definite  purpose  of  enacting  a clear  and  equitable  law  which 
can  be  enforced  in  a fair  and  just  manner.” 

Here  is,  practically,  the  whole  meat  of  the  question  which 
is  now  before  us.  We  find  that  every  man  who  is  thinking 
of  building  a factory  or  choosing  a residence  takes  the  tax 
list  and  goes  over  it  to  see  where  he  will  have  to  pay  the 
least  taxes.  He  finds  he  can  go  to  one  town  and  pay  six  or 
seven  dollars  a thousand,  or  he  can  go  to  another  and  pay 
eighteen  or  twenty  dollars  per  thousand.  He  finds  that  if  he 
builds  a factory  in  one  place  in  the  Commonwealth  he  will 
have  to  pay  one  rate  of  taxation,  while  if  he  builds  it  in  an- 
other he  will  have  to  pay  another  rate.  That  is  one  of  the 
results  of  our  present  system  of  taxation  of  personal  property. 

In  looking  into  this  subject,  we  also  find  that  the  taxes  on 
corporations  are  divided  throughout  the  State  in  a manner 
which  seems  to  us  manifestly  unfair.  We  find  Nahant  and 
Milton  with  sixty  per  cent.,  and  upwards,  of  personal  property, 
and  Somerville  with  only  seven  per  cent.  Now  that  is  the  point 
at  which  we  have  directly  aimed,  namely,  to  equalize  this  per- 
sonal property  tax,  and  spread  it  over  the  State  as  it  should 


ADDRESS  OF  MR.  JOHN  C.  COBB. 


be.  There  is  no  possible  justice  in  the  tax  on  the  Boston  & 
Albany  Railroad  going  to  the  town  of  Nahant.  That  rail- 
road is  chartered  by  the  people  of  the  Commonwealth,  is 
supported  by  a very  large  proportion  of  the  people  of  the 
Commonwealth,  but  has  no  more  to  do  with  Nahant  than  it 
has  to  do  with  Chicago ; therefore  we  say  that  the  tax  on  the 
Boston  & Albany  Railroad  should  be  divided  as  nearly  as 
possible  among  the  communities  which  created  and  support 
it,  and  that  the  easiest  and  best  way  to  accomplish  that 
result  is  to  pay  it  into  the  treasury  of  the  Commonwealth, 
and  let  the  State  government  apportion  it  among  the  towns 
and  cities  of  the  State  by  applying  it  to  the  State  and  county 
expenses. 

The  result  of  this  change  in  the  system  of  taxation  is  quite 
striking.  It  improves  and  helps  the  condition  of  our  most 
burdened  towns,  and  takes  away  from  the  surplus  in  towns 
which  have  been’growing  more  and  more,  year  after  year,  to 
be  spots  towards  which  personal  property  flows ; this  is  a 
problem  which  I think  you  will  all  agree  with  me  must  be 
met.  I do  not  know  that  you  all  appreciate  the  extent  to 
which  personal  property  has  been  moving  away  from  the 
heavily  taxed  towns  and  cities  into  towns  where  there  is  a 
low  tax-rate.  There  is  a distinct  and  ever-increasing  current 
flowing  toward  those  towns  which  now  have  the  most  of  it; 
and  this  we  want  to  stop. 

We  have  made  up  some  figures  in  regard  to  the  cities  in 
the  Commonwealth,  and  I have  classified  them  by  their  per- 
centage of  personal  property,  with  the  following  results : 

In  the  first  class  we  have  two  cities  — Everett  and  Somer- 
ville. Now,  the  proposed  change  will  unquestionably  be  a 
benefit  to  the  cities  of  Everett  and  Somerville,  for  the  effect 
of  it  will  be  that  they  will  be  entirely  relieved  from  all  per- 
sonal-property tax,  and  will  have  their  tax  on  real  estate 
reduced.  That  is  a surprising  statement,  but  it  is  true. 

Ex-Governor  LONG.  — Won’t  you  explain  why  that  is? 

Mr.  COBB. — It  is  on  account  of  the  very  small  percentage 


24 


TAXATION. 


of  personal  property  that  those  cities  have,  and  their  being 
relieved  from  the  State  and  county  taxes,  which,  in  these  two 
cases,  would  undoubtedly  exceed  the  amount  collected  from 
personal  property. 

We  next  come  to  class  two,  which  takes  in  the  cities  of 
Brockton,  Chelsea,  Malden,  Marlboro’,  Medford,  Quincy, 
Woburn,  and  Worcester.  They  all  come  within  a narrow 
range  of  percentage.  These  cities  will  practically  arrive  at 
the  result  of  being  relieved  from  any  tax  upon  personal 
property,  and  will  have  little  or  no  increase  in  the  tax  on 
real  estate  for  the  same  reason  — because  of  their  small  per- 
centage of  personal  property. 

The  next  class,  class  three,  is  the  large  class.  It  takes  in 
the  cities  of  North  Adams,  Pittsfield,  Taunton,  Beverly, 
Gloucester,  Haverhill,  Lawrence,  Lynn,  Newburyport,  Chico- 
pee, Holyoke,  Springfield,  Northampton,  Cambridge,  Lowell, 
Newton,  Waltham,  Fitchburg,  and  Boston.  These  cities  present 
to  us  the  real  problem,  which  is  to  so  adjust  the  tax  as  fairly 
to  meet  the  needs  of  those  cities  which  contain  the  bulk  of  the 
property  of  the  State  — because  the  cities  which  I mentioned 
in  the  first  and  second  classes  are  a small  item,  and  those  in 
the  fourth  and  fifth  classes  are  a very  much  smaller  item. 

We  have  made  figures  in  regard  to  Boston  which  will  sub- 
stantially apply  to  all  these  cities.  We  have  figured  it  out, 
and  find  that  the  change  in  Boston  will  result  in  an  increase 
of  about  two  dollars  per  thousand,  making  the  rate  in  Boston 
about  fifteen  dollars,  with  the  result  that  the  citizens  of  Bos- 
ton will  be  absolutely  freed  of  the  burdens  of  taxation  in  all 
other  forms,  except  when  a person  dies  and  his  estate  goes 
through  the  Probate  Court,  at  which  time  his  property  pays 
a succession  tax. 

Now,  gentlemen,  the  whole  question  is,  are  you  willing  to 
add  a couple  of  dollars  a thousand  to  your  tax-rate  for  the 
sake  of  deriving  the  advantages  which  this  law  is  going  to 
give  to  the  Commonwealth  of  Massachusetts?  If  you  are 
willing  to  do  that,  the  problem  is  solved,  and  we  can  go 


ADDRESS  OF  MR.  JOHN  C.  COBB. 


25 


ahead  on  the  lines  we  have  laid  down.  I will  go  one  step 
further,  gentlemen,  and  say  that  if  you  are  not  willing  to  do 
that,  we  will  fix  this  law  so  that  it  will  suit  your  ideas.  We 
want  to  readjust  this  question  of  taxation  upon  a fair  and 
proper  basis.  We  want  your  ideas  and  assistance  in  our 
efforts.  We  have  made  up  our  own  ideas  upon  a basis 
which  seems  to  us  fair,  and  will  give  marvellous  results  with 
a very  slight  change  in  the  present  burdens. 

The  next  class  of  cities  is  class  four,  which  takes  in  Fall 
River  and  New  Bedford.  As  you  all  know,  those  cities  are 
distinctively  manufacturing  cities.  Almost  all  of  their  manu- 
facturing is  done  by  corporations,  the  stock  in  which  is 
owned  by  persons  in  their  own  localities,  and  therefore  they 
get  their  own  tax  from  their  own  corporations  for  them- 
selves. The  tax  on  real  estate  will  be  more  largely  increased 
in  these  two  cities  than  in  those  cities  in  the  previous  classes ; 
but  on  the  other  hand  there  will  be  no  two  cities  in  the  Com- 
monwealth which  will  feel  the  direct  benefits  and  results  of  the 
change  in  an  encouragement  to  their  special  and  practically 
only  industry,  manufacturing,  than  these  two  cities.  For  that 
reason,  we  believe  that  no  possible  injustice  will  result  to  them 
from  our  adjustment  of  this  matter. 

I am  sorry  to  say  that  in  the  fifth  class  there  is  one  city. 
That  city  is  Salem.  There  is  very  little  to  be  said  about  that 
fifth  class.  Salem,  gentlemen,  comes  right  in  with  Nahant 
and  my  town  of  Milton.  Salem  collects  forty-one  per  cent, 
of  her  tax  on  personal  property,  and  Milton  collects  sixty. 
All  we  have  to  say  about  them  is  that  they  must  look  at  this 
question  for  the  good  of  the  Commonwealth  of  Massachu- 
setts, and  not  for  their  own  personal  and  private  interests. 
(Laughter.) 

In  closing,  I want  to  say  just  one  word.  I want  to  ask 
each  and  everyone  of  you  to  look  at  this  question  in  a broad 
way,  considering  not  only  what  is  best  for  your  own  locality, 
but  what  is  best  for  the  Commonwealth ; we  want  every  man 
of  you  to  take  sufficient  interest  in  this  subject  to  consider  it 


26 


TAXATION. 


seriously  and  fully,  to  communicate  with  us  in  regard  to  it,  to 
bring  it  before  your  city  governments,  and  if  we  are  not  right 
to  tell  us  why  we  are  not  right.  If  you  have  ideas  that  differ 
from  ours,  do  not  say  that  ours  are  bad,  but  give  us  your 
ideas,  and  help  us  to  a conclusion  which  will  suit  the  majority 
of  the  people  of  the  Commonwealth,  and  will  be  for  the  inter- 
est of  the  whole  State,  which  is  all  we  are  aiming  at.  Our 
whole  idea  is  simply  to  encourage  the  development  of  Massa- 
chusetts, and  to  enable  it  to  compete  with  the  other  States  of 
the  Union  which  are  working  on  these  lines.  If  the  State  of 
Massachusetts  can  lead  in  solving  this  question  of  tax  reform, 
it  will  not  only  receive  business  benefits  of  the  first  importance 
as  a result  of  this  law,  but  it  will  stand  where  it  belongs,  as 
the  leader  of  public  opinion  and  the  prominent  factor  in  solv- 
ing great  questions  of  this  sort  for  the  people  of  the  United 
States.  (Applause.) 


EDITORIALS. 


( From  the  “ Boston  Herald February  19,  1896.) 

THE  PROPOSED  TAX  REFORM. 

The  tax  bill  which  the  Merchants’  Municipal  Committee  — 
that  is,  the  committee  representing  the  various  trade  organi- 
zations of  Boston  that  Mayor  Quincy  has  called  upon  to 
advise  him  — has  recommended  to  the  favorable  action  of 
the  Legislature  is  one  of  the  greatest  importance.  We  doubt 
whether  the  Legislature  has  had  under  consideration  for 
years  a subject  of  more  vital  interest,  or  one  which,  if  favor- 
ably acted  upon,  would  result  in  larger  or  more  general 
benefit  to  all  classes  of  the  people  in  the  State. 

It  has  been  evident  to  all  who  have  looked  into  the  matter 
that  the  system  of  taxation  in  force  in  the  State  of  Massa- 
chusetts is  an  exceedingly  unsatisfactory  one.  Not  only 
those  who  may  be  called,  or  who  call  themselves,  scientific 
tax  reformers  have  condemned  it,  but  the  local  assessors,  the 
common  country  people,  the  merchant  and  the  laborer,  have 
all  found,  from  time  to  time,  reason  to  condemn,  not  only  the 
laws  as  they  stand,  but  the  method  in  which  they  are  exe- 
cuted. The  Constitution  requires  that  a tax  shall  be  levied 
upon  all  classes  of  property  without  discrimination ; yet,  in 
certain  instances,  this  law  is  construed  so  that  it  taxes  prop- 
erty twice,  and  even  three  times  over.  On  the  other  hand, 
in  a great  majority  of  cases,  personal  property  is  not  taxed 
at  all,  and  in  this  respect  we  have  an  illustration  given  of  the 
biblical  saying  that  “ whosoever  hath,  to  him  shall  be  given,, 
but  whosoever  hath  not,  from  him  shall  be  taken  away  even 


28 


TAXATION. 


that  which  he  hath ; ” as  the  burden  of  the  tax  falls  upon 
those  in  humble  circumstances  who  are  eminently  conscien- 
tious, and  upon  the  little  trust  estates  of  widows  and  orphans. 
In  other  words,  the  ones  who  should  be  taxed  escape  the 
burden,  while  those  who  might  fairly  be  exempted  are  called 
upon  to  bear  an  entirely  unwarrantable  load. 

When  one  takes  into  account  that  on  the  best  evidence 
obtainable  not  more  than  a fifth,  and  possibly  not  a tenth,  of 
the  personal  property  in  the  State  of  Massachusetts  pays 
any  tax  whatsoever,  the  folly  of  continuing  our  present 
method,  — which  is  simply  oppressive  and  restrictive  in  its 
character,  discouraging  instead  of  encouraging  trade  and 
manufacture,  — the  injustice,  we  say,  of  this  present  method 
becomes  too  apparent  to  need  argument.  There  is,  how- 
ever, one  period  when  it  is  possible  to  get  an  accurate  state- 
ment of  personal  property,  and  this  is  when  this  form  of  per- 
sonal estate  passes  by  succession  from  its  former  dead  owner 
into  new  hands.  At  such  a time  it  comes  up  for  legal  certi- 
fication and  valuation  under  conditions  which  do  not  lend 
themselves  to  evasion,  as  it  is  ordinarily  the  interest  of  some 
one  in  probating  an  estate  to  see  that  the  amount  probated 
is  fully  inventoried  and  valued  up  to  its  true  value.  Expe- 
rience, not  only  in  this  country,  but  also  in  Europe  and 
Australia,  has  made  it  evident  that  a succession  tax  can  be 
collected  with  the  minimum  of  trouble,  and  with  hardly  any 
possibility  of  evasion. 

It  is  true  that  a man  might  make  gifts  before  his  death 
to  children  or  to  friends,  and  to  this  extent  exempt  his 
estate  from  the  payment  of  a succession  tax ; but  human 
nature  is  such  that  men  almost  invariably  hold  to  what  they 
have  as  long  as  they  have  life,  and  it  would  be  a rare  indi- 
vidual who,  expecting  his  decease,  sought  to  evade  a post- 
mortem tax  by  an  anticipatory  division  of  his  wealth.  As 
experiences  of  this  kind  do  not  occur  in  the  States  and 
countries  where  this  method  is  in  use,  it  may  be  assumed 
that  human  nature  in  Massachusetts  would  not  be  pro- 


EDITORIALS. 


29 


ductive  of  results  altogether  different  from  those  found  else- 
where. 

The  plan  which  the  committee  suggests  of  having  all 
distinct  local  taxes  assessed  upon  real  estate,  and  of  having 
the  State  collect  franchise  taxes  and  succession  taxes,  and, 
after  paying  State  expenses  out  of  these,  remitting  the 
balance  first  to  the  counties,  and  from  these,  if  there  is 
any  to  remain,  to  the  municipalities,  seems  to  us  an  exceed- 
ingly sensible  proposition.  The  only  changes  that  we  would 
suggest  in  the  bill  that  has  been  presented  would  be  to  have 
the  succession  tax  of,  say,  five  per  cent,  apply  both  to  direct 
and  indirect  inheritances,  so  that  there  would  be  no  discrim- 
ination whatsoever  in  this  respect;  and,  second,  that  in 
dividing  the  tax  after  State  expenses  had  been  defrayed, 
the  basis  of  division  be  that  of  population,  rather  than  the 
assessed  value  of  real  estate. 

The  plan  of  division,  under  any  circumstances,  is  an  arbi- 
trary one.  The  money  collected  from  successions  and  fran- 
chises would  come  into  the  State  treasury,  and  if  there  is 
any  surplus  it  would  seem  fairer  to  have  this  given  both  to 
the  counties  and  the  municipalities  on  the  basis  of  numbers. 
Of  course,  this  would  be  of  distinct  advantage  to  the  poorer 
towns  and  cities  where  the  real-estate  valuation  was  not  par- 
ticularly high;  but  it  is  our  opinion  that  those  localities 
where  the  real-estate  valuation  was  large  — that  is,  the 
^business  centres  of  the  State  and  the  towns  and  cities  im- 
mediately around  them  — would  benefit  so  tremendously, 
by  improvements  in  trade  and  manufacture,  in  consequence 
of  this  tax  reform,  that  they  could  well  afford  to  give  this 
advantage  in  the  way  of  distribution  to  their  poorer  munic- 
ipal neighbors.  Such  a change,  it  seems  to  us,  would 
popularize  the  measure  with  the  country  members,  as  it 
would  constitute  for  them  a distinct  financial  gain,  while  it 
would  also  tend  to  encourage  in  their  minds  ideas  of  State 
and  county  economy,  since  the  smaller  the  annual  expendi- 
tures of  the  State  or  the  county,  the  larger  the  amount  that 


30 


TAXATION. 


would  be  left  over  from  the  succession  and  the  corporate  tax, 
to  be  divided  among  the  various  municipalities. 


{From  the  “ Boston  Transcript February  19,  1896 .) 

UP-TO-DATE  TAXATION. 

Massachusetts  has  been  notoriously  an  assessor-ridden 
State  — the  favorite  hunting-ground  of  local  officials  in- 
vested, after  the  antiquated  methods  of  the  days  of  small 
things,  with  the  power  of  digging  out  as  many  dollars’  worth 
of  property  as  they  could  find  subject  to  taxation.  Instead 
of  depending  on  taxables  that  cannot  be  concealed,  the  Com- 
monwealth has  offered  a premium  on  fraud  and  false  swear- 
ing,  giving  such  men  the  choice  between  lying  and  taking 
their  possessions  into  localities  where  better  treatment  would 
be  accorded.  Thus  has  grown  up  a system  of  taxation 
anomalous,  exasperating,  and  really  ineffective.  It  forms  a 
subject  worthy  of  the  attention  of  enlightened  business 
men  and  merchants,  who  believe  that  the  State  and  city 
have  a right  to  call  upon  them  to  devote  a portion  of  their 
time  to  the  improvement  of  methods  which  have  been  here- 
tofore deemed  indispensable  to  raise  the  means  to  keep  in 
motion  our  State  and  municipal  machinery. 

The  Merchants’  Municipal  Committee,  appointed  at  the 
request  of  Mayor  Quincy  to  act,  in  certain  specified  cases,  as 
an  advisory  board  for  the  City  Government,  has  moved  in 
the  matter  of  revising  the  system  of  taxation  in  vogue  in 
this  State,  and  formulated  a scheme  of  general  taxation  for 
the  whole  Commonwealth,  which,  if  it  should  be  adopted, 
would  almost  mark  an  era  in  the  changes  it  will  produce. 
What  the  committee  has  sought  to  accomplish  finds  fit 
expression  in  the  committee’s  own  words  : “ We  claim  that  the 
law  embodied  in  the  bill  now  presented  can  be  easily  and 
equitably  administered,  and  that  it  will  prevent  favoritism 
to  one  locality  over  another  by  its  execution.  It  changes 


EDITORIALS. 


31 


and  equalizes  the  division  of  the  corporation  and  personal- 
property  taxes  by  turning  them  into  the  State  treasury  to 
provide  for  State  and  county  expenses,  thereby  distributing 
them  to  the  entire  Commonwealth.”  Other  reforms  sug- 
gested will  render  it  easy  to  collect  the  full  amount  of  the 
taxation  laid,  and  leave  capital,  while  employed  in  active 
business  or  industrial  enterprises,  free  from  taxation.  The 
bill  imposes  a succession  tax,  and  describes  just  how  it  shall 
be  levied. 

But  the  great  feature  of  the  proposed  legislation  is  in  its 
exemption  of  quick  capital  from  taxation,  and  taxing  visible 
property  in  the  shape  of  real  estate  to  defray  public  ex- 
penditures. The  committee  estimates  that  this  would  only 
increase  the  tax  on  real  estate  in  Boston  $2.26  per  thousand, 
or  17^  per  cent.,  and  this  increase  would  be  offset  by  the 
immediate  rise  of  values  through  expanding  business.  The 
committee  forcibly  states  that  this  is  not  an  untried  experi- 
ment. It  is  substantially  the  system  adopted  in  Pennsylvania 
by  law  and  in  New  York  and  Chicago  by  custom,  with  the 
results  witnessed  in  the  concentration  of  capital  in  those 
cities.  Governor  Greenhalge  showed  his  progressive  tend- 
encies in  calling  attention  to  the  fact  at  the  opening  of  this 
session  of  the  Legislature  by  saying,  “ It  is  impossible  to 
fairly  and  efficiently  collect  our  taxes  under  the  present  law,” 
and  he  suggests  an  investigation  “ with  a definite  purpose 
of  enacting  a clear  and  equitable  law  which  can  be  enforced 
in  a fair  and  just  manner.”  The  municipal  committee, 
appointed  at  Mayor  Quincy’s  request,  has  acted  upon  these 
considerations  offered  by  Governor  Greenhalge,  and  its  bill 
is  now  before  the  public.  It  will  tend  to  produce  such  a 
unity  of  interest  between  different  sections  of  the  Common- 
wealth, so  far  as  taxation  is  concerned,  as  will  be  salutary  in 
every  respect. 

The  regulations  upon  which  the  practice  of  assessment  and 
valuation  of  property  are  concerned  should  no  longer  remain 
contrary  to  common  sense  and  dictated  by  the  most  super- 


32 


TAXATION. 


ficial  knowledge  of  the  laws  which  govern  trade  and  finance. 
If  Massachusetts  is  not  to  fall  far  astern  in  the  competitions 
which  now  characterize  business,  it  should  cut  clear  of  the 
old  tradition  that  where  you  see  something  of  value,  tax  it, 
— even  if  it  will  only  stand  one  year’s  taxation,  — and  adopt 
the  liberal  policy  of  inviting  capital  into  the  State,  so  that 
our  citizens  may  obtain  the  advantage  of  its  being  used  in 
the  locality  where  destiny  has  fixed  their  residence.  Every 
additional  thousand  dollars  retained  within  the  State,  which 
would  have  been  driven  out  of  it  by  a harsh  system  of 
taxation,  is  a testimonial  to  the  growth  of  liberal  and  enlarged 
sentiments  on  the  question  of  taxation  in  the  Commonwealth. 


(. From  the  “ Springfield  Republican”  February  19,  1896.') 

CANNOT  BE  TOO  HIGHLY  PRAISED. 

We  cannot  too  warmly  commend  the  general  features  of  this 
proposed  local  taxation  reform  plan  of  the  Boston  Merchants’ 
Municipal  Committee.  It  is  as  simple  and  practicable  and 
just  as  the  present  tax-system  is  complex,  burdensome,  in- 
equitable, and  impracticable.  It  sweeps  away  the  thousand 
petty  restrictions  and  complications  and  burdens  and  harass- 
ments  which  the  present  cumbersome  system  throws  upon 
the  business  activities  of  citizens,  and  still  does  not  materially 
change  the  incidence  of  the  general  tax-burden.  We  have 
lately  called  attention  to  the  fact  that  the  tax  reformers 
would  have  to  make  some  concession  to  the  personal-prop- 
erty taxationists  in  order  to  achieve  any  progress ; and  in 
providing  a fairly  high  tax  on  personalty  passing  at  the 
death  of  the  owner,  the  committee  has  met  this  condition  in 
the  way  we  have  proposed. 

The  succession  taxes  may  have  to  be  made  higher,  and 
perhaps  graduated,  to  win  any  considerable  support  to  the 
plan  from  the  opposition,  but  nothing  should  be  left  undone 
consistent  with  the  general  principle  involved,  and  justice  to 


EDITORIALS. 


JJ 

all  interests,  to  win  success  for  the  measure.  Its  enactment 
into  law  would  mean  much  for  the  progress  and  welfare  of 
the  State. 

It  will  be  seen  that  the  plan  is  very  simple.  Taxes  for 
local  revenue  are  to  be  confined  to  real  estate.  The  State  is 
to  collect  the  whole  of  its  revenue  from  independent  sources 
— from  the  corporation  and  franchise  taxes,  and  from  succes- 
sion taxes  on  personal  property  as  it  passes  through  the 
probate  courts.  These  latter  taxes  are  provided  for  as  an 
offset  to  the  exemption  of  such  property  during  the  life  of 
the  owner. 


(From  the  “ Boston  Post ,”  Febriiary  ig,  i8g6.') 

TAX  REFORM. 

The  bill  drafted  by  the  Merchants’  Municipal  Committee 
for  the  reform  of  taxation  in  Massachusetts  goes  very  close 
to  the  bottom  of  things.  It  exempts  personal  property  from 
taxation,  except  at  the  time  when  it  passes  through  the 
Probate  Court — which  is  the  only  time,  indeed,  when  it  can 
be  reached  with  certainty.  It  levies  city  and  town  taxes  on 
real  estate  alone,  and  it  imposes  a franchise  tax  upon  cor- 
porations which  enjoy  the  use  of  public  property,  and  it 
leaves  capital  free  when  employed  in  industrial  enterprise. 

These  are  the  lines  on  which  the  “ Post”  has  urged  the 
revision  of  the  tax  laws ; and  they  are  practical  lines.  The 
gain  through  the  imposition  of  an  inheritance  tax  will  alone 
go  far  to  make  up  the  loss  of  the  personal-property  tax  as 
now  assessed,  while  the  increase  of  the  burden  on  real  estate, 
on  which  it  is  proposed  to  assess  all  local  taxes,  is  consid- 
ered to  be  more  than  offset  by  the  addition  to  its  value  con- 
sequent upon  the  operation  of  the  system  as  a whole. 

The  manner  of  distribution  of  the  State  taxes,  derived 
from  inheritances  and  franchises,  is  probably  as  equitable  as 
could  be  devised.  If  some  of  the  small  towns  find  their 
income  likely  to  be  cut,  they  should  be  content  to  accede  to 
what  is  shown  to  be  equitable. 


34 


TAXATION. 


DOUBLE  TAXATION. 

{From  the  “ Boston  Traveller February  iy,  i8<?6 .) 

The  attention  of  legislators  is  being  again  invited  to  the 
wrongs  involved  in  what  is  called  double  taxation,  or  in  the 
levying  of  taxes,  within  this  State,  upon  shares  owned  by 
residents  of  Massachusetts,  in  corporations  situated  outside 
the  State,  the  property  of  which  is  taxed  by  authority  of  the 
State  where  situated.  It  is  estimated  that  the  resident  within 
this  State  pays,  in  poll  tax,  income  tax,  and  in  contributing 
by  his  presence  and  consumption  of  labor  and  goods  in  the 
current  business  of  the  community,  a fair  equivalent  for  his 
enjoyment  of  the  social  advantages  which  induce  him  to  fix 
his  residence  here,  and  that  his  ownership  of  shares  in  a 
manufacturing  or  other  corporation  conducting  business  in 
other  States  should  not  be  burdened  with  taxes  here,  pro- 
vided always  the  corporate  property  is  taxed  where  it  is 
found  in  use. 

It  must  be  confessed  that  this  looks  fair  on  the  face  of  it, 
though  there  are  those  who  might  insist  that  it  would  operate 
to  encourage  men  to  invest  their  money  outside  of  Massa- 
chusetts rather  than  within  it.  This  could  only  be  true, 
however,  if  the  tax  rate  outside  the  State  were  materially 
lower  than  within  it.  Just  how  such  property  is  to  be 
exempt  — how  the  fact  of  taxation  in  another  State  is  to  be 
made  officially  known  — is  of  course  a question  of  method 
only. 

Aside  altogether  from  the  abstract-justice  aspect  of  the 
matter,  the  practical  result  of  the  present  system  would  seem 
sufficient  to  commend  the  change.  Massachusetts  and  Maine 
are  said  to  be  the  only  North-eastern  States  which  tax  this 
class  of  property,  and  in  making  up  the  list  for  assessment 
the  officials  found  in  this  State,  — mainly  in  trust  properties 
where  the  ownership  had  gone  on  record  in  some  way,  — a 
few  years  ago,  about  fifteen  million  dollars,  and  by  dint  of 
much  inquiry  and  profiting  by  various  hints,  managed  to 


EDITORIALS. 


35 


guess  at  about  fifty-five  millions  besides  this,  making  a total 
assessed  valuation  of  about  seventy  millions,  while  estimates 
made  about  the  same  time  by  trustworthy  authorities  in 
financial  matters  placed  the  amount  of  such  property  owned 
in  this  State  at  not  less  than  six  hundred  million  dollars.  It 
is  submitted  that  a tax  which  costs  the  people  so  much 
unmitigated  lying  is  an  unprofitable  and  immoral  investment 
for  the  State. 

The  drift  of  conclusion  in  the  matter  of  a just  tax-system 
is  toward  confining  it  to  real  estate,  which  cannot  be  hidden 
nor  carried  out  of  the  State ; an  inheritance  tax  which 
tends  to  catch  personal  property  at  about  the  only  time  it  is 
ever  disclosed ; and  a tax  on  corporate  franchises  most 
of  the  value  of  which  is  created  by  the  taxing  community. 
The  argument  of  the  opponents  of  “ double  taxation  ” leads 
strongly  in  the  same  direction. 


{From  the  “ Boston  Evening  Record February  iq,  18968) 

One  feature  of  the  new  tax-reform  act  presented  by  the 
Merchants’  Municipal  Committee  is  its  great  simplicity. 
Collect  taxes  for  local  revenue  from  real  estate ; that  is  the 
whole  plan.  Corporation  and  franchise  taxes  and  succession 
taxes  are  to  contribute  for  the  State  revenue.  It  does  away 
with  complications,  cumbersome  burdens,  erasements,  and  a 
large  amount  of  detail.  The  question  is  whether  the  addi- 
tional tax  will  be  gladly  paid  by  the  citizens  in  order  to 
secure  this  directness. 


( From  the  “ Boston  Evening  Record March  2 , 1896.) 

Mayor  Quincy  has  been  very  successful  in  attracting  sup- 
port to  the  taxation  bill  which  the  Merchants’  Municipal 
Committee  have  presented  to  the  Legislature.  Both  the 
Mayor  and  his  committee  have  been  very  ready  to  acknowl- 
edge the  debt  owed  by  them  to  Governor  Greenhalge  for 


36 


TAXATION. 


the  forcible  argument  in  his  latest  message  in  support  of  this 
scheme ; and  the  men  of  both  parties,  who  look  to  see 
a simplification  of  the  system  of  taxation,  a more  equitable 
system  of  tax-raising,  and  a lessening  of  the  franchise  of 
large  corporations,  are  joining  with  him  side  by  side. 


{From  the  “ Boston  Post,”  March  2 , 1896 .) 

THE  NEW  TAXATION. 

It  was  expected  that  a campaign  of  education  would  be 
necessary  in  order  to  impress  upon  the  public  mind  the  desir- 
ability of  the  reform  of  our  system  of  taxation  on  the  lines 
laid  down  by  the  Merchants’  Municipal  Committee.  The 
meeting  of  the  mayors  on  Saturday  ought  to  advance  this 
campaign  considerably. 

The  objection  which  lies  upon  the  surface  is  undoubtedly 
the  apparent  advantage  given  the  metropolis  over  the  country 
districts  by  a system  of  taxation  which  places  the  burden  of 
local  taxes  entirely  on  real  estate  and  exempts  personal  prop- 
erty. But  this  advantage  is  only  apparent,  not  real ; and 
such  discussions  as  that  which  was  held  on  Saturday  serve 
to  make  this  fact  clear. 

The  proposed  change  is  radical  as  to  method,  but  conserv- 
ative as  to  effect.  That  is  to  say,  it  abolishes  a method 
which  is  complicated  and  in  many  ways  unjust,  in  favor  of 
entire  simplicity,  while  it  saves  to  the  citizen  the  protection 
of  his  interests  which  the  existing  system  tries,  but  fails,  to 
give. 


{From  the  “ Boston  Globe,”  March  14 , 1896.) 

PRACTICAL  TAXATION  REFORM. 

At  first  glance  the  new  regime  in  State  taxation,  favored 
and  proposed  to  the  Legislature  by  that  representative  and 
conservative  body,  the  Merchants’  Municipal  League  Com- 


EDITORIALS. 


37 


mittee,  seems  to  mean  a very  complete  and  radical  change 
of  system. 

An  analysis  of  its  operation,  however,  indicates  no  radical 
change  of  the  burdens  of  taxation,  except  in  the  case  of 
certain  towns  with  a very  large  or  very  small  percentage  of 
personal  property. 

An  average  increase  of  $2  per  thousand  on  real  estate, 
which  is  the  estimate  of  advocates  of  this  reform,  is  certainly 
no  very  serious  matter  when  weighed  against  the  great  ad- 
vantages of  simplicity  of  administration  and  encouragement 
to  business  which  it  is  believed  will  result  from  the  change 
in  the  manner  of  collecting  the  personal  tax.  Moreover, 
fully  one-quarter  of  this  increase  would  fall  on  a compara- 
tively small  number  of  towns,  and  those  the  “ tax-dodging  ” 
towns,  for  which  there  will  be  little  sympathy.  The  average 
increase  for  the  rest  of  the  State  would  be  only  about  $1.50. 

The  bill  on  behalf  of  taxation  reform  is  designed  to  adjust 
and  equalize  taxation  throughout  the  State,  taking  Boston 
and  the  l^rge  number  of  cities  and  towns  in  the  same  class 
as  a basis.  The  result  would  show  that  such  places  *as 
Chelsea,  Somerville,  Everett,  Malden,  Melrose,  Quincy,  and 
Hyde  Park  materially  benefit,  while  Manchester,  Nahant, 
Milton,  and  the  like  have  to  suffer  by  the  averaging  process, 
which  seems  also  to  work  to  the  especial  advantage  of  Frank-' 
lin,  Hampden,  and  Hampshire  counties. 

An  important  feature  of  this  taxation-reform  bill  is  the 
relief  which  it  offers  to  our  cities  and  towns  from  the  onerous 
conditions  incident  to  the  present  methods  of  collecting  the 
State  tax. 

With  regard  to  the  plan  proposed  for  the  collection  of 
taxes  on  personal  property  by  the  succession  tax,  the  claim 
has  been  advanced  that  people  would  give  away  their  property 
before  death.  This,  however,  is  contrary  to  human  nature, 
which  is  the  one  thing  to  be  reckoned  with.  People  as  a 
rule,  as  everybody  knows,  cling  to  what  they  have  until 
death  takes  it  from  them,  and  they  are  very  apt  to  leave 


38 


TAXATION. 


those  who  follow  them  to  take  their  chances.  Moreover,  in 
point  of  fact,  the  succession-tax  system  has  been  very  thor- 
oughly tried  in  other  countries,  especially  in  England  and 
France;  and  experience  has  shown  that  there  is  no  appreci- 
able amount  of  evasion  through  anticipation  of  death. 

A great  deal  of  careful  and  conscientious  work  has  evi- 
dently been  given  to  the  preparation  of  this  measure  of 
taxation  reform.  No  snap  judgment  should  be  pronounced 
on  a measure  of  such  a character,  warmly  indorsed  as  it  is  by 
so  many  of  our  representative  citizens.  We  are  free  to 
admit  that  the  more  closely  this  bill  is  examined  the  more 
logical  and  sound  it  appears. 


The  Rockwell  and  Churchill  Press,  Boston. 


